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A $500k business would mean you'll end paying on average between $3-5 million for it. May I ask your rationale behind chasing these deals? Why not split the $3-5 million into risk-based chunks and invest in startups instead? You only need 1 of them to hit 50x.
I sold Bingo Card Creator through FEI ( http://feinternational.com ) and have nothing but good things to say about them. Something like 20% of their listings are SaaS businesses. The going rate for a SaaS business is roughly 3X yearly SDC ("seller discretionary cashflow" -- revenue minus costs required to run the business as opposed to e.g. the owner's salary, distributions, interest expense, etc). It is closer to 2X…
I sold Bingo Card Creator through FEI ( http://feinternational.com ) and have nothing but good things to say about them. Something like 20% of their listings are SaaS businesses. The going rate for a SaaS business is roughly 3X yearly SDC ("seller discretionary cashflow" -- revenue minus costs required to run the business as opposed to e.g. the owner's salary, distributions, interest expense, etc). It is closer to 2X…
Patrick's talk at Microconf on selling Bingo Card Creator was fascinating—nice set of notes at http://doubleyouraudience.com/microconf/patio11/
I sold Bingo Card Creator through FEI ( http://feinternational.com ) and have nothing but good things to say about them. Something like 20% of their listings are SaaS businesses. The going rate for a SaaS business is roughly 3X yearly SDC ("seller discretionary cashflow" -- revenue minus costs required to run the business as opposed to e.g. the owner's salary, distributions, interest expense, etc). It is closer to 2X…
A $500k business would mean you'll end paying on average between $3-5 million for it. May I ask your rationale behind chasing these deals? Why not split the $3-5 million into risk-based chunks and invest in startups instead? You only need 1 of them to hit 50x.
A few recommendations based on my experience (YMMV):
- Cash is king. While you should definitely structure the deal with a transition period, an all-cash offer carries more weight than a deal where you are financing some/all of the price. You'll need to show proof of funds too, so make sure you can do that easily.
- Get your attorney on standby. You'll probably need help with offer letters and purchase agreements. Plan on going through a couple rounds of revisions for both.
Feel free to email me if you have more questions.
I sold Bingo Card Creator through FEI ( http://feinternational.com ) and have nothing but good things to say about them. Something like 20% of their listings are SaaS businesses. The going rate for a SaaS business is roughly 3X yearly SDC ("seller discretionary cashflow" -- revenue minus costs required to run the business as opposed to e.g. the owner's salary, distributions, interest expense, etc). It is closer to 2X…
Off topic, but: I like your blog! Thanks!
I'm in Austin. Lemme know if you want to meet. My email is HN username + gmail.
Earlier quoted context omitted.
Patrick's talk at Microconf on selling Bingo Card Creator was fascinating—nice set of notes at http://doubleyouraudience.com/microconf/patio11/
I'll write about this more in the near future -- don't want to step on a Starfighter announcement coming up though.